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P 5 . 1 2 L&G Inc., a retailer of garden tools that follows ASPE, had the following statements prepared as of December 3 1
P L&G Inc., a retailer of garden tools that follows ASPE, had the following statements prepared as of December : L&G Inc. Comparative Statement of Financial Position December Cash $ $ Accounts receivable Inventory Prepaid rent Equipment Accumulated depreciationequipment Total assets $ $ Accounts payable $ $ Income tax payable Longterm loans payable Common shares Retained earnings Total liabilities and shareholders equity $ $ L&G Inc. Income Statement Year Ended December Sales revenue $ Cost of goods sold Gross margin Operating expenses Operating income Interest expense $ Gain on disposal of equipment Income before income tax Income tax expense Net income $ Additional information: Dividends on common shares in the amount of $ were declared and paid during Depreciation expense of $ is included in operating expenses. Equipment with a cost of $ that was depreciated was sold during Instructions Prepare a statement of cash flows using the direct method. Prepare a statement of cash flows using the indirect method.
P L&G Inc., a retailer of garden tools that follows ASPE, had the following statements prepared as of December :
L&G Inc. Comparative Statement of Financial Position December
Cash
$
$
Accounts receivable
Inventory
Prepaid rent
Equipment
Accumulated depreciationequipment
Total assets
$
$
Accounts payable
$
$
Income tax payable
Longterm loans payable
Common shares
Retained earnings
Total liabilities and shareholders equity
$
$
L&G Inc. Income Statement Year Ended December
Sales revenue
$
Cost of goods sold
Gross margin
Operating expenses
Operating income
Interest expense
$
Gain on disposal of equipment
Income before income tax
Income tax expense
Net income
$
Additional information:
Dividends on common shares in the amount of $ were declared and paid during
Depreciation expense of $ is included in operating expenses.
Equipment with a cost of $ that was depreciated was sold during
Instructions
Prepare a statement of cash flows using the direct method.
Prepare a statement of cash flows using the indirect method.
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